Summary

 

  • Nigeria was removed from the Financial Action Task Force (FATF) grey list as of 24 October 2025.
     
  • Exit follows completion of Nigeria’s reform agenda (including a 19-point Action Plan) to strengthen AML/CFT frameworks.
     
  • Delisting signals reduced jurisdiction-risk for Nigeria, potentially lowering costs and friction for international banking, trade and investment flows.
     
  • Key implications for stakeholders:
    i. Banks: smoother correspondent banking relationships and trade-finance access.
    ii. Fintechs: fewer stigma-driven compliance burdens, improved cross-border operations.
    iii. Compliance teams: must maintain enhanced KYC/KYB, monitoring and governance even post-delisting.
     
  • Not a finish line: Nigeria must sustain reform, guard against emerging risks (crypto misuse, sanctions evasion) and translate the milestone into operational maturity.
     
  • Regional context: Nigeria’s delisting, along with peers like South Africa and Mozambique, reflects upward movement in Africa’s financial-integrity landscape.


 

Nigeria’s delisting from the FATF Grey List: What it is and why it matters.

 

On 24 October 2025, the FATF officially removed Nigeria from its “grey list” of jurisdictions under increased monitoring for weaknesses in anti-money-laundering (AML) and counter-terrorist-financing (CFT) frameworks.
Nigeria met the required reforms and completed its action plan, strengthened key institutions, enabling the country to regain full standing in the global financial integrity system.

 

What exactly does “exit from the grey list” mean?

 

Being on the grey list means a country has strategic deficiencies in its AML/CFT regime and is under increased international scrutiny. Exiting means the country has improved sufficiently through reforms, according to FATF, and will face fewer restrictions, less stigma, and (often) improved access to global finance. Such a country is no longer subject to heightened monitoring.
For Nigeria, it means that correspondent banks, foreign investments, cross-border payments, and trade finance operations can now proceed with less regulatory friction.

 

Why did Nigeria end up on the list in the first place?

 

In February 2023, Nigeria was added to the FATF grey list because the FATF identified significant gaps: poor enforcement of AML laws, weak inter-agency coordination, poor beneficial-ownership transparency, and inadequate financial-intelligence sharing.
Global financial partners considered Nigeria a higher-risk jurisdiction for illicit money flows, which spurred extra cost and scrutiny for banks and businesses working there.

 

What reforms did Nigeria implement to get delisted on the FATF Grey List?

 

What did Nigeria do to be removed from the FATF grey list? Here are some of the concrete steps taken by Nigeria to be removed from the FATF greylist:

 

  • A 19-point Action Plan developed jointly with the FATF and regional body Inter‑Governmental Action Group Against Money Laundering in West Africa (GIABA) aimed at strengthening AML/CFT systems.
     
  • Legislation amendments and institutional enhancements, improving the capacity of the Nigerian Financial Intelligence Unit (NFIU), enhancing inter-agency coordination, increasing oversight of gatekeepers and financial institutions.
     
  • Improved transparency and collaboration among regulatory bodies, enforcement agencies and international partners. 

President Bola Ahmed Tinubu described the delisting as a “major milestone in Nigeria’s journey towards economic reform, institutional integrity and global credibility”.

 

Timeline: Key Milestones of Nigeria's Removal from the FATF Grey List

 

  • Feb 2023: Nigeria listed by FATF. 
     
  • March–June 2025: NFIU and partner agencies report “substantial progress” and FATF on-site review is planned.
     
  • 24 October 2025: FATF delisting announced at Paris plenary.

 

What measurable impact can be expected when delisted from the FAFT greylist?

 

When a country is delisted from the FATF greylist by FATF, the impact can be both symbolic and economic.

 

  • The delisting sends a strong signal of improved governance and transparency, which boosts investor confidence.
     
  • A global study found that grey-listing can reduce foreign capital inflows by as much as ~7.6% of GDP.
     
  • For banks and fintechs operating in Nigeria: fewer extra due-diligence burdens, less “de-risking” by correspondent banks, and potential reduction in transaction costs.

 

What does this mean for banks, fintechs and compliance professionals?

 

1. Reduced friction for international transactions:

For financial institutions operating in Nigeria or with Nigerian counterparties, one big barrier has been reduced. With the grey-list stigma removed, correspondent banks may apply fewer extra due-diligence burdens.

 

2. Stronger investor confidence:

Investors use indicators like FATF listings as part of country-risk assessments. Delisting signals improved regulatory governance and risks that are better controlled.

 

3. Compliance teams should still stay vigilant:

Although the grey list exit is important, it’s not the end of the journey. It opens the door, but institutions must continue to strengthen AML/CFT frameworks (procedures, monitoring, sanctions/PEP screening, transaction monitoring) to avoid re-listing or reputational risk.

 

4. Opportunity for market differentiation:

Firms that proactively highlight their compliance robustness (KYC, KYB, AML, transaction monitoring) will have an edge in Nigeria’s evolving financial-services market.

 

  • Commercial banks: Expect smoother correspondent banking relationships, lower “risk premium” pricing, and better trade-finance access.
     
  • Fintechs / digital lenders: Less stigma and friction for cross-border operations, faster onboarding for customers, and improved investor access.
     
  • Non-financial firms (insurers, payment platforms): Better access to global insurers/reinsurers, improved partner trust, and easier expansion.
     
  • Compliance & risk teams: While the country risk has dropped, the standard of compliance must remain high; institutions must continue investing in KYC/KYB, transaction monitoring, sanctions/PEP screening, and regulatory-reporting frameworks.

 

A first-hand case study: What we observed in the field

 

At Youverify, we observed that in the past 12 months, Nigerian banks and fintechs increased investment in:

  • Enhanced due diligence platforms to manage high-risk clients and cross-border flows.
     
  • Improved transaction-monitoring coverage using better rule-sets, data-feeds, and analytics (e.g., Youverify’s transaction monitoring platform).
     
  • Engagement with the FIU and regulators to ensure real-time suspicious-activity-reporting (SAR) compliance.

One mid-sized bank we worked with reported that after embarking on a compliance overhaul, the cost of correspondent banking relationships dropped by ~30% (as the heavy compliance burdens were reduced). This aligns with global analysis suggesting delisting may ease funding costs and capital inflows.

 

What risks remain, and what must be done?

 

Being delisted does not mean perfect. Concerned Institutions must now maintain high standards and continue reforms, or risk being put back on the list.

 

  • Global financial-crime risks (crypto flows, sanctions evasion, proliferation financing) continue to evolve requiring vigilance beyond basic compliance.
  • The reputational benefit must be converted into operational maturity: stronger KYC/KYB, ongoing monitoring, governance, cross-border risk frameworks.
  • Nigeria must institutionalise reforms, ensuring that progress is durable, not just point-in-time.
  • Evolving threats: crypto misuse, sanctions evasion, proliferation financing, must be addressed proactively. 
  • Firms should convert this improved country risk into competitive advantage (strong compliance = trust = growth).
  • There is still a reputational dimension: being delisted doesn’t erase years of perception, so visible transparency, auditability and regulatory disclosures remain crucial.

 

Frequently Asked Questions (FAQs) on Nigeria's Removal from the Grey List

 

Q: When was Nigeria removed from the grey list?

 

A: Nigeria was removed from the grey list on October 24, 2025

 

Q: Has Nigeria been removed from the grey list?

 

A: Yes, Nigeria was removed from the grey list on the 24th of October 2025.

 

Q: Does Nigeria’s exit from the grey list mean banks don’t need to do AML checks any more?


 A: No. AML/CFT obligations remain. Delisting simply reduces enhanced jurisdiction-risk scrutiny, but individual institutions still must conduct KYC/KYB, monitor transactions, screen for sanctions/PEPs and report suspicious activity.

 

Q: Will this affect correspondent banking relationships for Nigerian banks?


 A: Yes. With delisting, correspondent banks may face lower counter-party risk perceptions, fewer extra checks and possibly lower costs, but banks still need to demonstrate strong compliance frameworks.

 

Q: What should fintechs or neobanks operating in Nigeria take away?


 A: This is an opportunity to differentiate. By demonstrating strong KYC/KYB, AML/transaction-monitoring systems, and regulatory alignment (with the Central Bank of Nigeria, the NFIU etc.), you can position yourself as a more trusted partner in Nigeria’s financial-services ecosystem.

 

Final thoughts

 

Nigeria’s removal from the FATF grey list is a landmark achievement for the country’s AML/CFT reforms and broader financial-governance agenda. For banks, fintechs, compliance teams and service providers (like us), it signals a shift: the regulatory environment is improving, and the market is signalling readiness for more sophisticated financial-services innovation.


But let’s be clear: this is not the end, just a major milestone. The real work is now about consolidating reform gains, embedding robust compliance systems, maintaining transparency and ensuring that Nigeria’s financial-services ecosystem continues to align with global best practice.